medical aid fund benefit option is not a one-size-fitsall.
You must consider the cover you need, how much
money you can spend on contributions and whether
a specific benefit option has any features that don’t suit
you. Choosing the right medical aid cover for you and your
family is very important. There are many options to choose
from and before you make a decision, you may need to ask
yourself a few questions.
How much can you afford to spend?
When deciding to join a medical aid fund, first ask yourself
what you can afford to spend on the monthly premiums. If you
need to see a dentist, you’ll want a policy that pays for it. If you
need an operation you’ll want to be booked into a private ward
in the best hospital in Namibia. But are you willing to spend
N$10,000 per month for such a benefit privilege? If your budget
is between N$1,000 and N$1,500 a month, it is always best to
choose a benefits option that is affordable. Knowing how much
you can spend reduces most of the work.
What medical cover do you need?
Medical aid cover is broken down into two parts:
In-hospital expenses (which happen while admitted into a
hospital) and
Out-of-hospital-expenses (doctors, dentists and over the
counter medication).
Without knowing what you need from medical aid cover,
you will not know which medical aid benefit option to choose.
Therefore you will need to ask yourself the following questions:
How much did you spend on day-to-day medical expenses
during the past year?
How much did you spend on visits to the doctor – N$3,000?
Hospitalisation – N$0? Dentistry – N$5,000? Medicine –
N$2,000? If you already belong to a medical aid fund, it’s even
easier. Just ask them to send you a copy of your claims history
for the last twelve months;
Which of those expenses where once off and which won’t
come up again soon (like maternity)? Which are likely to come
up again and again (Like the flu)? Twice a year you should see
the oral hygienist, so this needs to be included in the budget.
Can you pay on your own out-of-hospital expenses?
If yes, then look at medical aid fund options that just covers
your hospital requirements;
If you don’t have enough money, then consider a medical
aid benefit option with a savings account (MSA) attached to it.
More information can be found by reading the out-of-hospital
cover section of this article.
If you find that you do not use the medical aid as much and
is unlikely to claim unless you need a serious operation, then
all you need is a simple hospital benefit option. If you run out
of savings by March, then you need a plan with much higher
savings. For example, a 20 year old who hasn’t seen a doctor
since the day his mother gave birth to him needs something
quite different from the 50 year old with high blood pressure
and diabetes.
The younger you are, generally, the healthier you are. That
means you may need less coverage. The older and sicker you
are, the more medical aid cover you need.
Membership and reserve level
Accumulated funds (reserves) is the net asset value of medical
aid funds, and must be maintained at the minimum prudential
required reserve level (“reserves level”), i.e. 25% of gross
contributions. It is very important to look at the medical aid
fund’s membership status and reserve level. Some funds have a
big membership base, but their reserve level is far below or close
to the prudential minimum required level of 25%. This means
the fund is likely to have a bigger premium increase at the end of
the year. Reserve levels may drop annually, should a fund have a
bad claims experience that year.
Other funds’ membership might be small, but the reserve level
is high, which means enough funds are available and premium
increases at the end of the year can be expected to be lower than
the average in the market.
Administration
It is important to know who the Fund Administrator is and how efficient they are in offering assistance, client services and
paying out claims.
In-hospital benefits, exclusions and co-payments
Before deciding on which medical aid fund benefit option
you want to join, you have to look at the cover each one offers
you. The most important question is, how are you covered in
hospital?
Most medical aid funds benefit options cover you at 100%
or more of the Namibian Association of Medical Aid Funds
(NAMAF) tariffs. Other options cover you at 120%, 150%,
200% or even 225%. This means it is always vital to negotiate
rates with the medical provider (anaesthetist, specialist, doctor,
etc.) If you don’t do that, you will be liable for the difference in
costs. The other option is to take out an additional product to
cover that cost, like additional insurance cover.
ALWAYS read the small print. Study your product brochure
to make sure of what is excluded on your option. Some medical
aid funds will exclude joint replacements or neck and back
operations, so it is VERY important to take note of exclusions.
You will then know exactly what you are covered for and what
is not included in your package, so that you are not caught off
guard.
It is also important to be aware of all co-payments. Many
medical aid funds have co-payments (i.e. covered from your
pocket) on certain procedures, like gastroscopies, laparoscopies,
removal of wisdom teeth, colonoscopies and joint replacements.
Co-payments differ from fund to fund and also depend on
whether the procedure is done in or out of hospital.
Out-of-hospital cover
Some medical aid fund benefit options in the marketplace
work with “savings”. These are called New Generation options,
where you are given a percentage of your monthly premium
upfront for the year. This is available to you immediately,
depending on the applicable waiting period.
These “savings” will be used for almost everything outside
of hospitalisation and also for any co-payment you might have.
Once the savings have been depleted for the year, you will have
to pay for the out-of-hospital expenses out of your own pocket.
Chronic medication
When it comes to chronic medication, first make sure it
is covered on the option you want to join. Ensure that your
condition is regarded as chronic and that the medication you
use is also covered. Most people join an option because it covers
their condition, but when it comes to the medication, the medical
aid fund says it is not on their formulary and is not covered. They
will then request you to use an alternative. If that is not possible,
they will pay you the Namibian dollar amount for the alternative
and you will be liable for the difference in cost.
Oncology, dialysis and HIV
You also have to make sure how the medical aid fund and
option cover oncology, dialysis and HIV. Most medical aid funds
have specific benefit programmes for these conditions, which
offer good cover, but it is important to make sure exactly what
that cover is.
In conclusion, once you have familiarised yourself with the
available options offered by your respective medical aid fund, it
will be easier for you to select a cover that is right for your needs.
By answering the questions in this article you now know:
1. Which medical aid fund benefit options suit your budget;
2. Whether you need a more or less comprehensive option;
and
3. Whether it’s just in-hospital coverage (big expenses) you
need or should you include out-of-hospital expenses;
Now you can start shopping and comparing various medical
aid fund benefit options and remember to choose the option that
best meets your medical needs.
References
http://www.insurancefundi.co.za;
http://www.fin24.com/Money/Health/How-to-choose-theright-
medical-aid-20141017; and
http://www.medicalaid.co.za/medicalaid/importantconsiderationswhenchoosingamedicals.
aspx
